Some months ago, my business partner and I had an appointment with an investor. We were to meet him at his office. When we walked in, he welcomed us and offered us drinks. I was anticipating the outcome of the meeting. I didn’t really believe that people could just dip their hands into their pockets and dole out cash to you because you have a brilliant idea. I was excited because this was a whole new world for me, and maybe such quick transactions actually do happen. As we kept talking about the whole idea, I realized that the investor didn’t talk in the direction of money. He just talked generally about our marketing strategy and gave us some advice pointing out the loopholes in our strategy. His advice was concrete, but I was still very much misplaced. We had talked about everything else, but what about the money, the actual investment? I mean, I watch movies where investors write big cheques for young entrepreneurs with brilliant ideas, but this meeting didn’t seem any close to the money.
Although I was still surprised that he didn’t talk money, I cherish his advice because there was truly an obvious loophole in our marketing strategy. We had done our research, but we missed something, and this guy pointed out what we missed to us from his archive of experience. We were truly very surprised as to how we could have missed that piece of information, but still, I couldn’t help thinking about the money. The whole point of the meeting was meant to revolve around the money. Well, there was no money, there was just advice.
Young entrepreneurs like me are making the same mistake right now. You have a brilliant idea, and you believe so much in your idea, and you believe the whole world should support your idea, but then you meet an investor and the investor ends up giving you, not money, but advice. Then you’re lost because it is not advice that you need.
A young entrepreneur feeling smart about himself or herself isn’t going to ask for advice, naturally because of pride. He’d be like, ‘I researched my idea, I’ve done everything… these are just elderly guys trying to tell me how I cannot do it and blah blah blah.’ Instead, the young entrepreneur is going to expect money, you know, financial investment, startup capital. But this is the Common Mistake just as the title of this post reads. Young entrepreneurs, instead of seeking advice, they seek money.
I made a post a while back titled Your Guardian Angel. Your guardian angel is in other words your mentor, someone to guide you through the path of business, someone you look up to, someone with some experience. This person will give you advice as you move up in your pursuit. Your mentor will make sure that you commit fewer mistakes. I emphasized in that post the importance of building trust.
You’re meeting an investor for the first time. Hey! Common! You cannot ask him/her for money! Just imagine that a thousand other young entrepreneurs approach the same investor for money. It’s insane, right? Because you just come in with your idea saying, ‘I have a very brilliant idea, I believe 100% in my idea, my idea is the best, I’m going to push competitors off the market. Just give me the cash.” No! A million entrepreneurs can come in that way too, so does the investor keep on doling out cash like that just by word of mouth? Capital NO.
You have to build trust. I know you believe so much in your idea, I know you believe your idea is going to revolutionize the market and whatnot, but you have to build trust. No matter how fantastic your idea is, you have to build trust with a potential investor.
This is a common mistake young entrepreneurs make, we want the money so fast because we want to start. We don’t want somebody telling us what we are missing, we don’t want someone giving us advice. We want the money, you know, just give us the money, believe in my idea right now, believe in it, believe in it, can’t you see it’s so brilliant? Believe in my idea right now, give me your money, give me your money. But it is never going to work that way because money is HARD to come by, money is freaking hard to come by, and no investor in their right senses is going to give you money on the first day.
What you need to do as a budding entrepreneur is to learn. Don’t try to move too fast. What you need to do is learn from these people with more experience, let them feed you with their advice, and as you implement their advice you’re building trust with these investors. Instead of looking for an investor, look first for a mentor.
A mentor is an investor. Yes, because when you’re talking about investment, you’re not just talking about money. Parents ‘invest’ in their children by sending them to school. Investment is such a broad term. A mentor could also invest in you by giving you advice. It’s the same investment. It’s all about understanding the term investment. You have to know what you’re looking for exactly, because an investor could invest in you in so many ways. So don’t get sad and depressed when the money doesn’t come by the way you think it should. Money is hard to make, this is why you should give the investor a valid reason to put his hands in his pocket and dole out that freaking hard-earned cash. Give him the best reason in the world. You have to impress the investor. But I’d advice that you seek mentorship first before cash. Because to tell you the truth, mentorship is cash waiting to happen. If you can build enough trust with your mentor then it’s all a matter of time, because one day that mentor is going to call you and say, ‘Look, I think you’re ready, come take some cash.’ It’s all about trust. In the world of money, trust is everything.
In what way are you trying to build trust with a potential investor? Let us know, comment below.